Google's Mobile Edge Slowing Bing's Growth

Google Import in Bing Ads, which allows advertisers to port over existing AdWords campaigns into Microsoft's platform, got a boost Tuesday with the addition of Automated Imports.

This feature no longer requires advertisers to remember to update ad copy, extensions and budgets. These and other changes made in AdWords campaigns are automatically updated in Bing by scheduling imports.

Despite Bing's attempt to push out products that make life easier for advertisers, data released Tuesday from Merkle suggests that Microsoft's search engine continues to struggle when it comes to diverting market share from Google.

The report analyzes why marketers spent less for search advertisements running across Bing Ads and Yahoo Gemini platforms -- which remained down compared to a year earlier -- yet Bing Product Ads were one bright spot, as spend growth for the format showed positive growth.



Combined spending across Bing Ads and Yahoo Gemini fell 13% year-over-year in the fourth quarter of 2016, up slightly from the 14% decline in the previous quarter. Bing Product Ad spending rose 16% in the final quarter of 2016, following a 12% decline in the previous quarter.

Overall, the share of desktop paid-search spend rose to 63%, as advertisers moved Google spend from tablet to desktop. The share of paid-search clicks on smartphones rose to 47%, up from 33% a year earlier. Tablet click share fell to 9%, half of its all-time peak.

When asked about paid and organic search trends for Yahoo, Mark Ballard, senior director of research at Merkle, lumped Bing into Yahoo on the paid side of search. Search spend for the two combined fell 13% year-over-year. "I don't know how they get out of this situation because the biggest piece of this is mobile," he said.

Indeed, one of the biggest struggles for Bing remains Google's strength in mobile market share. Google’s share of mobile organic search visits rose from 89% in fourth-quarter 2015 to 93% in fourth-quarter 2016. Google mobile organic search visits rose, but desktop visits fell at a faster rate than a quarter earlier. Yahoo organic search visits continued to decline, falling 28% Y/Y in the fourth quarter. Bing organic search visits fell 11%, although Bing was the only major search engine to see positive desktop growth.

Spending on search ads grew 14% YoY in fourth-quarter 2016, in line with third-quarter results. Click growth slowed from a 20% YoY increase in the third quarter to a 15% increase in the fourth quarter, while CPC declines shrunk to a half-point decrease, per the report. Click and CPC growth trends from the third to the fourth quarter of 2016 were a mirror image of those from the same period  in 2015, when a sharp increase in Google mobile inventory bolstered click growth and depressed CPC growth.

Ads appearing in position three and four at the top of Google search results drove nearly 5% of Google phone text ad clicks in the fourth quarter of 2016. Smaller advertisers and those that produce a larger share of clicks from non-brand keywords see the greatest impact from Google expanding the number of mobile text ads it shows.

In the fourth quarter, Google produced more than 96% of phone clicks -- up from 95% in the third quarter -- and 89% of all clicks. The company also capitalizes on iOS device search ad clicks, which hit 64% in 2016, just under its share a year earlier.

"As more people use their mobile devices for searches, that benefits Google which is the default search provider for iOS and Android," Ballard said.

Apple devices are responsible for 43% of search ad clicks on mobile devices. Between iOS devices and desktop Safari, Apple accounted for 43% of all search-ad clicks in Q4 2016, up from 38% in Q4 2015. For Google, that means more than 45% of clicks were produced by iOS and desktop Safari combined.

The biggest issue for Google remains non-brand search ad traffic on mobile driving down conversion rates.

Merkle's data reports Google produced an 11% higher conversion rate than Bing and Yahoo in fourth-quarter 2016 for the typical advertiser, down from a 23% advantage a year earlier.

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